24 July 2020
Conveyancing – Capital gains withholding when one vendor is foreign resident
We have three vendors selling a property worth over $750,000 and one of them is a foreign resident. If we provide the purchaser with clearance certificates for two and not for the foreign resident, will they only need to withhold one-third of the 12.5% on their share or the full 12.5%?
Thank you for the question.
The purchaser needs to withhold 12.5% of the foreign resident vendor's interest if they do not provide a clearance certificate. See Variation 47 on the ATO website.
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